6 compelling reasons to rent a home

Not everyone dreams of owning their own home, in fact according to McCrindle’s Renter of the Future report, almost one third of renters in Australia said they chose to rent not for financial reasons, but because of the lifestyle benefits it provides.

Let’s have a look at some of the most compelling reasons as mentioned by tenants.

Affordability

Renting tends to be more affordable than buying. In many cases monthly rental payments are usually lower than mortgage repayments, particularly in major capital cities. For young professionals who are seeking a fast paced lifestyle and career opportunities in the city, renting can be a big advantage. It gives greater value for your money, if you can afford the rent where you want to live and still have extra to put into your savings account each week you may be better off plus you don’t have a mortgage debt and the responsibility that involves.

Changing places

Almost 40 per cent of renters said that the freedom to change where they live easily is a huge benefit of renting. In most cases, a tenancy agreement in Australia only requires a commitment of 6 to 12 months.

Realise that you don’t quite like the neighbourhood? Want to move closer or further to the CBD? Find a new job elsewhere? After this period, there is no obligation to renew the contract and you’re free to simply move to a location that is more ideal.

Upsizing and downsizing

Maybe you have a partner that’s moving in or you’ve decided to work from home and need an extra room. Either way, it’s not uncommon for space requirements to change all the time. In McCrindle’s study, 24 per cent of people recognised this, citing the ability to upsize or downsize their home easily as a great advantage. This way, you can also adapt your living arrangements to your finances without too much hassle.

No Maintenance costs or repair bills

A definite advantage renters have over homeowners is that they have no maintenance costs or repair bills to pay off. When you rent a property, your landlord is responsible for all maintenance and repair costs. If a property’s appliance stops working or your roof starts to leak you do not have any financial responsibility to have these things fixed (in most cases). Homeowners, on the other hand, are responsible for all of their own repair, maintenance and renovation costs. Depending on what the repair is, these costs can be quite extensive.

Access to Amenities

Another financial benefit to renting, over buying a house of your own is having access to amenities that would otherwise be an enormous expense. Luxuries such as an in-ground pool or a fitness center come standard at many midscale to upscale apartment complexes with no additional charge to tenants. If a homeowner wants to match these amenities, he or she can expect to pay thousands of dollars in installation and maintenance costs. Similarly, apartment / unit owners need to pay monthly fees to pay for access to these amenities.

No Land Tax

An obvious benefit that renters have over homeowners is that they do not have to pay land taxes. Land tax can be a hefty burden for homeowners and the tax varies by state. The landlord is responsible for the payment of this tax and therefore as a renter you are not responsible for it.

Property Investing Basics – What Makes a Good Investment

Making Informed Decisions

Have you been like a cat at a fish bowl, looking into the Australian property markets only to find yourself unable to make that final commitment? To help you we have spoken to some of our property management experts who live and breathe property and asked them to share what they believe makes a good investment.

Where You Buy

Location is obviously the most important, and that can be narrowed down as much as a street, or even an aspect of the street that can make a significant difference to the potential growth of a property’s performance,” our agents said.

They assert that if you are looking for an area to invest in, a good rule to stick by is to ensure that it is within a 10-kilometre radius of a major city hub – an even smaller distance for smaller cities like Adelaide or Perth.

“Also, it’s sometimes a good idea to start your investment portfolio in an area that you live in, because you’ll know that market more than anyone else does,” they said.

What You Buy

Our Property Managers stress the importance of not only focusing on the quality of the property you purchase, but also the size.

They have seen owners in the past caught out that way. They’ve gone and paid a price for a three-bedroom terrace, say in an area like Surry Hills, and it ends up becoming a two-bedroom rental because of the size of that third bedroom,” they said. Sell my house in Mundelein

If you’re a first-time investor and can’t decide between purchasing a house or a unit, it is recommend you discuss your objectives with your local LJ Hooker real estate agent and their experienced Property Management team as they will have a good perspective as to the rental capability of the property.

“Buy into an apartment building that is fairly modern – nothing too old where there could be a special levy raised as suddenly the building needs repainting because it’s 30 years old or the fire alarms need to be upgraded, for example,” they said.

When You Buy

Our agents believe there is never a bad time to buy property, you just may have to look in different areas depending on what the market is doing.

“The property market is only as abundant as the people pushing it. As soon as they step back, it is often an opportunity when you should jump in on investment property,” they said.

A proper understanding of the market is crucial. Going to open homes and viewing auctions to paint a clear picture of the market. If they’re all going crazy then that’s an indicator that it’s time to take a step back and wait for things to settle down.

Any Other Tips?

As some final pieces of advice, our agents said to not expect quick profits from property, be patient, take your family and friends’ critique with a grain of salt and ensure that you “engage a skilled and qualified property manager that has a good reputation, because that could make or break the investment”.